OEMs Are Seeing The Light

“Acer and Asustek have been pushing forward in marketing hardware/software-integrated cloud computing solutions focusing on educational applications and web storage, respectively, according to the companies.”

For more than a decade, OEMs have been living with paper-thin margins because they have fairly cheap labour in Asia and many competitors. They have been grumbling that M$ and Intel have been taking the gravy and leaving the OEMs with dirty dishes. The OEMs are mad as Hell and not going to take it any longer. They are already diversifying into ARMed devices, and FLOSS such as GNU/Linux and Android/Linux. Now, they are looking into services. They have a huge advantage, because he who installs the cloud API on the devices gets first crack at selling the customer the service…

Clouds are very competitive. Public clouds are lead by Amazon but private clouds are lead by OpenStack. Either would be usable by OEMs.

Oops! Instead of OEMs working for free for Wintel, OEMs will soon be operating like normal businesses working to please their customers and working for themselves. No longer slaves, they don’t have to take orders from Intel and M$. They will be free. Consumers and businesses may also see the benefit and the last lock-ins of Wintel will fall away.

Services that OEMs can sell this way include file/backup/security/search/web service and anything their imaginations come up with to distinguish them from their competitors. More businesses are using web applications every day and these are easily implemented on the web or in the cloud. Many small businesses may be able to do without servers at all if the OEMs set things up for them reasonably well. That cuts Wintel out of the clients, servers, web applications and cloud services, just about everything in IT. Wintel may be able to “partner” with some OEMs but not all and the OEMs that opt for ARM, */Linux, and FLOSS will have a huge price/performance advantage.

Already, */Linux is doing well in the cloud arena. Intel can, of course compete against AMD in servery but ARM is on the verge of entering in a big way and FLOSS works just as well on ARM as x86/amd64.

About Robert Pogson

I am a retired teacher in Canada. I taught in the subject areas where I have worked for almost forty years: maths, physics, chemistry and computers. I love hunting, fishing, picking berries and mushrooms, too.

You are wandering off of the topic, too. You complained first of “illegal monopoly” and “illegally maintained”. This has nothing to do with bundling (about which Microsoft was found not guilty of any violation of the law anyway).

Their monopoly power was lawfully obtained and their proscribed actions had no effect on maintaining it according to the judges. They are likely to be much more familiar with the law than you and I would take their opinion over yours on that basis alone.

bw wrote, “I think that this is where you are going wrong. Neither of these things are true.”

Both are true regardless of what findings there were in court. We know the courts get things wrong some times. Bundling is illegal. Forcing OEMs to bundle is illegal. M$ did both.

Wikipedia: “Some kinds of tying, especially by contract, have historically been regarded as anti-competitive practices. The basic idea is that consumers are harmed by being forced to buy an undesired good (the tied good) in order to purchase a good they actually want (the tying good), and so would prefer that the goods be sold separately. The company doing this bundling may have a significantly large market share so that it may impose the tie on consumers, despite the forces of market competition. The tie may also harm other companies in the market for the tied good, or who sell only single components.”

Wikipedia: “In competition law, exclusive dealing refers to when a retailer or wholesaler is ‘tied’ to purchase from a supplier on the understanding that no other distributor will be appointed or receive supplies in a given area. When the sales outlets are owned by the supplier, exclusive dealing is because of vertical integration, where the outlets are independent exclusive dealing is illegal (in the US) due to the Restrictive Trade Practices Act, however, if it is registered and approved it is allowed.
Exclusive dealing can be a barrier to entry.
One form of exclusive dealing – known as third line forcing – is prohibited per se, meaning that it is prohibited no matter what its effect on competition.
Third line forcing involves the supply of goods or services on condition that the purchaser acquires goods or services from a particular third party, or a refusal to supply because the purchaser will not agree to that condition.”

The remedial order of the district court in No. 02-7155 is affirmed. In No. 03-5030, the order denying intervention is reversed and the order approving the consent decree in the public interest is affirmed.”

and

“We upheld the district court’s ruling that Microsoft violated § 2 of the Sherman Act by the ways in which it maintained its monopoly, but we reversed the district court’s finding of liability for attempted monopolization, and we remanded the tying claim to the district court to apply the rule of reason rather than the rule of per se illegality. See Microsoft III.”

The Kamaz racing truck for the “Kamaz 4×4 Dakar” youtube some time.
Life span normally 1 race. Its also the two most expensive units Kamaz makes.
KAMAZ 4326-9 Dakar 4×4 Dakar Rally Sport truck (this can in fact have tipper tray fitted) So yes Rally Sport dump truck can exist. Combination of words that seam like they should not be combined.
KAMAZ 4911 Extreme 4×4 Civilian Sport truck Dakar Rally ( yes this is like a normal 4×4 over grown)

As you said phones are replaced more often than PC’s. Result more sales for OEM’s if this can work. This is the thing the Hybrid gets to break the longer than longer life span cycles of the PC for a while at least. Early PC age people were replacing computer every 1 to 2 years. Exactly what reason do you think that mobile phones will not flatten out. There is one they are a public fashion item.

PC’s are a nerds fashion item so have limited marketing effectiveness.

How about you coming clean and acknowledge these relevant facts concerning M$, fair enough?

Sez the unlettered dougman who despises us weaklings for paying for an education that he is certain he can do without, thus saving tons of money. Your lack of education has gotten you into trouble here, it seems, and the facts you provide are only proof of my statement that there is no illegal monopoly at all and no action was taken that succeeded in maintaining it once legally obtained.

The NY Times piece is a premature assessment of the DOJ case that came out long before the final verdicts were handed down. Even so, it notes that “The problem for Judge Jackson in devising an acceptable remedy is that the government has failed to produce decisive evidence that Microsoft’s illegal tactics have as yet seriously harmed consumers.” That was echoed in the appeals verdict that noted that there was no causal effect of Microsoft’s actions that required any corrective action to be ordered.

The wiki article is somewhat sparse and out of date, too, but it does contain the essence of the case where it reveals “The D.C. Circuit Court of Appeals overturned Judge Jackson’s rulings against Microsoft.” Did you miss that somehow?

The DOJ press release is hardly evidence of anything, being a self-serving attempt at face-saving after wasting so much of the taxpayers money on a settlement that ended up improving Microsoft’s market position and allowing them to blame price increases for DOS and Windows on government orders.

M$ acquired a monopoly by illegal means… maintained it by illegal means,

I think that this is where you are going wrong. Neither of these things are true. If you have been under the impression that either were the case, then you should be willing to reconsider your position. Fair enough?

bw wrote, in a fine example of circular reasoning, “No court anywhere has ruled the monopoly power as illegal. The only problem has been occasional exercise of that power in ways that various courts have found to be in violation of various antitrust limits.”

So, M$ acquired a monopoly by illegal means, forcing OEMs to bundle M$’s OS, maintained it by illegal means, bundling, and used it to expand its business in other ways that are also illegal and bw can’t see it…

What is illegal about it? No court anywhere has ruled the monopoly power as illegal. The only problem has been occasional exercise of that power in ways that various courts have found to be in violation of various antitrust limits.

So you no longer care about the Windows servers and office businesses?

bw wrote, “there still should be some significant, long-term, verifiable decline in overall revenues”

M$ is welcome to diversify to basket-weaving. What I care about is the illegal monopolization of desktop PCs. That’s gone forever and shrinking fast. Even with business locked in they are down:
Operating Income
2013 $9.5
2012 $11.5
2011 $12.2
2010 $12.9
See the pattern? It’s down about 10% per annum, not fast enough for me but an improvement. What’s the Chromebook, the new improved netbook, */Linux notebooks, thin clients and a mess of tablets going to do? The decline will accelerate and M$ will use all its accumulated “unearned income” and that will be the end of it. M$ will have to work for a living.

Not in your mind, certainly, but there still should be some significant, long-term, verifiable decline in overall revenues, not just variances back and forth and internal shifts to newer businesses. It is more interesting from a blogging point of view to declare all these ills to be facts, but you have been doing that for a considerable period of time while the financials are not following your predictions.

bw, fooling himself that M$ is healthy, wrote, “This year, after such a horrible run of events with Steve Ballmer at the wheel, they sold just under $80B which is almost times the business they had at the onset.”

Bank robbers can do well for a while too. That doesn’t make their longterm prospects are good. M$ has burned its bridges. It has locked itself and its customers into unsustainable IT practices. Many customers are not continuing to be customers. Those truly locked in may indeed continue to throw money at M$ but more will wonder why. There is just no need for M$ on client or server. Not an office suite. Not a service. Nothing depends on M$. Businesses are moving to web applications and can chuck M$’s client OS. They can chuck the server OS too by using open standards.

So, there is no doubt M$ is in decline. It’s just a matter of how quickly the house of cards falls. It may well be that businesses will take up the slack as consumers get out of town but that’s not a long term phenomenon. M$ can’t even make XP go away. Those whose XP machines die may go to GNU/Linux Android/Linux or Google services.

I notice the 10-K is overdue. I bet they are doing a lot of rewriting so they don’t go to jail… Legally, they have 60 days after the 8-K but they usually just take a week. It’s mostly just copy and paste… I look forward to the details of their “unearned income” bank and other goodies.

“While our fourth quarter results were impacted by the decline in the PC market, we continue to see strong demand for our enterprise and cloud offerings, resulting in a record unearned revenue balance this quarter.”

I am interested how the unearned income for the client OS is doing. It’s kind of pathetic that they blame “the market” for their problems and not their product. They used to make their own market.

Get out and enjoy some golf, while you can and don’t worry Linux. It will be coming your way soon enough

Sayeth the Luddite doughman who feels that education is just another rip-off. I am just in from the morning’s golf and not too happy about it, either. Missing a short putt is bad but three is enough to make you irritable for the whole day.

But I am not too depressed to note that Microsoft’s revenue in 2000, a record year for them BTW, was a little more than $20B. This year, after such a horrible run of events with Steve Ballmer at the wheel, they sold just under $80B which is almost times the business they had at the onset. Is IBM times bigger? Is General Electric 4 times bigger? Is Boeing 4 times bigger? Caterpillar? Enron? ATT?

None have to be built to change the rules of the game. It will show where the upper limits of kick-starter are. Knowing the upper limits allow you to plan

What game is that? Phones and PCs, too, are mass market items and such a pipsqueak effort as this “kick-starter” are never going to change what goes on there. You can talk about the mouse and the elephant, perhaps, but relatively speaking this is more like a flea and an elephant.

A phone-in-a-dock-PC sort of gizmo strikes me as something that is in conflict with even itself. People are keeping PCs longer and longer, to the chagrin of the PC makers, but they seem to want to change cell phones more often than the typical 2 year contract allows. Trying to marry such divergent trends is likely to lead to complete failure. It is a dumb idea, kind of like a sport model dump truck.

Mmmm, maybe OEMs are seeing the light. Just received a test report originating with GigaByte for the micro-sized BRIX computers (i3, i5, and i7 versions). They tested it with Fedora 18 (32- bit), Redhat 6.4 (64-bit), and Ubuntu 12.04 (64-bit).

That is quite a change for them and their recent past. It is good sign!

Another great article, totally describing the problem that M$ has internally.

“Once upon a time, M$ dominated the computer industry and it was the wealthiest corporations in the world. But since 2000, as Google and a host of other companies out-thought and innovated around M$, it has fallen FLAT in every arena it entered: e-books, music, search engines, social networking, etc… Former executives and employees points fingers at the bald-headed monkey-boy as the man that led them astray.”

“I see Microsoft as technology’s answer to Sears,” said Kurt Massey, a former senior marketing manager. “In the 40s, 50s, and 60s, Sears had it nailed. It was top-notch, but now it’s just a barren wasteland. And that’s Microsoft. The company just isn’t cool anymore.”

“They used to point their finger at IBM and laugh,” said Bill Hill, a former Microsoft manager. “Now they’ve become the thing they despised.”

Eichenwald’s conversations reveal that a management system known as “stack ranking”—a program that forces every unit to declare a certain percentage of employees as top performers, good performers, average, and poor—effectively crippled Microsoft’s ability to innovate.

Re: No it wont. First off, I doubt that one will ever be built. All it is is a phone in a dock.

OH yes, the great bridge player speaks, all-unknowing and old, he even knows a buddy at BestBuy thats knows it all too. Linux, Ubuntu, eh…. never heard of it. Yes, it is a phone in a dock and I suppose that REALLY bothers you doesn’t it, enough so that you waste all your time blathering worthless drivel. Get out and enjoy some golf, while you can and don’t worry Linux. It will be coming your way soon enough.

I have been saying for 1-2 years that the docking smartphone to desktop OS will be a game changer. Unfortunately, you are to narrow-minded to see it.Also, you doubt what? That Canonicial could pull off such a feat? Please divulge your succicent knowledge.

bw
–No it wont. First off, I doubt that one will ever be built.–
None have to be built to change the rules of the game. It will show where the upper limits of kick-starter are. Knowing the upper limits allow you to plan.

–All it is is a phone in a dock. And the dock is not even readily available as part of the project.–
In fact its not. A phone with a dock has been done by Motorola. Production cost of that is 15 million. There is quite a bit of cost added by the parts chosen. Low production screen type being sapphire same with the batteries choose…. And the list goes on.

–Phones are communications devices primarily and PCs are computing devices primarily. Some small section of the population might be satisfied with only one or the other. The rest will continue to use both where one or the other is appropriate to the task at hand.–
Really we don’t know. Phones have never been able to CPU/GPU match up against the desktop.

No it wont. First off, I doubt that one will ever be built. All it is is a phone in a dock. And the dock is not even readily available as part of the project. Phones are communications devices primarily and PCs are computing devices primarily. Some small section of the population might be satisfied with only one or the other. The rest will continue to use both where one or the other is appropriate to the task at hand.

bw from the graphics of the progress 2 days before end should they hit 32 million.

bw there is still a very good chance they will make. In fact the exist 6 million in under 6 days is far greater than what anyone would have been expecting.

If Ubuntu on this kickstarter makes it. This rewrites the complete game. If it falls just short this says Ubuntu was over optimistic. But it still will result in disruption. Just short is somewhere between 28 million and 32 million. Reason 28 million is enough to get 10 000 slightly less advanced phones/tablets to market.

bw also you could align Microsoft with Sun Microsystems. Yes at one point Sun Microsystems was insanely rich and top pack. Then it slowly over years of slow death rotted away. Sun Microsystems in the end attempted to change path also was infective. Sun Microsystems holds the record for number of years of consecutive loses and staying in business. Really I want to see if Microsoft can break this record.

I could care less what M$ asserts of what they sold or how much the supposedly they made

It is sort of humorous to watch you anti-MS folk stuggle to denigrate the accomplishments of Microsoft over the past almost 40 years since their incorporation.

Smoke and mirrors, you say. IBM gave them the business on a silver platter, Pogson says. They cheated and robbed, they abused their customers, they exercise some form of mind control, and even more outlandish explanations of how they don’t deserve their results and are surely bound for perdition. They manage to get statistics recording devices to only recognize Windows usage and ignore Linux usage so as to make the measurements invalid. The list goes on and on.

And even after all that, you say “I don’t care!” Of course you care. You can’t get it out of your mind. There is no need to take any of this so personally, though. You need to get over it.

It’s a business, nothing more. Microsoft has had 40 years to familiarize their customers with their products and to establish a mutually beneficial relationship with most of them. In spite of the claims you make and the fantasies that you create in your mind the vast majority of Windows users do not encounter the sorts of problems you all relate continually and do not hate the company at all. Rather, Microsoft is seen as a paradigm of respectability and high quality.

They may have ups and downs, but their businesses will go on for a long time.

‘Windows’ doesn’t make any money either, M$ does, if you want to play the word game. ‘Windows’, ‘Linux’ are trademarks.

Oh yea, corporations that use Linux ‘do not make any money’ *rolls eyes* better tell that to Instagram, Facebook, Amazon, Google, I bet they would love your competent insight BW.

I could care less what M$ asserts of what they sold or how much the supposedly they made. Units / licenses sold does not equate to the physical, as in the physical consumer “using” it. Forget 100m licences ‘sold’.

See, M$ sells volume licenses and a OEM buys a VL-serial, which in-turn they can use on for instance 10,000 machines they are going to build. M$ will count this as “10,000 licenses sold” even if they are not all 10,000 actually installed and activated. See how this works?

Also, in reading the 10-K for 2012, M$ used Deloitte & Touche LLP, and as I seem to recall they were or still fraught with a few lawsuits. Can you say ENRON? I mean why else would M$ pay a departing CFO $2M for non-compete, secrecy promises. Why can’t M$ keep their CFOs??

Between the financials and recent huge sell-off, M$ is looking deathly ill these days.

None of them were actually asserted here by Microsoft fans, though. You yourself might ponder the predicament of having the likes of dougman as your principal supporter. If creating such clumsy straw men as posted below is your sign of strength, then you are not going to make the playoffs!

next quarter of disaster

There are disasters and then there are things that you would like to call a disaster, but you can’t get your wish. After the multi-billion aQuantive disaster, Microsoft dropped to #8 world-wide in terms of annual profits.

Reporting your first quarterly loss ever is not the way a company wants to end its fiscal year. But a bad bet on online ad unit aQuantive forced Microsoft to report a $6.2 billion writedown in its fourth-quarter results last June. The software giant has redeemed itself since then. Microsoft released Windows 8 last fall, and despite a dying PC market, sales jumped 23% last quarter. The company’s smartphone and tablet offerings have yet to make a dent against their rivals, but with boosts from the Xbox and a move to cloud computing, Microsoft is growing again and meeting expectations.”

Still, it was a record sales year for Microsoft and hardly a reason to change the coach. As Dandy Don often said, “You have to dance with the one who brought you!”

After more than 20 years on the scene, Linux is still not making any money. Should you fire Torvalds?

dougman pointed out a brilliant write-up on Semiaccurate: “They have no friends, they have no partners, and no one will go out on a limb to help them. Even when paid many refuse, the major web services are simply absent as far as apps go, not something that can be cured with a bit of cash. Their position simply can’t get any more dire than it is now, and that is a profound statement. Even well paid analysts don’t try and float excuses like the impending 7″ form factor will turn every thing around, Excel on a 7″ multi-touch screen is what you have been waiting for, right? Trade in your iDevices ASAP, how can you lose?”

This shows that M$ is bankrupt of ideas. If this is one of the tools of their empire, it really is doomed. They should fire Ballmer, of course, but they won’t until the next quarter of disaster when they write off the rest of their RT inventory.

Give M$ more money, consumers are ignorant fools, we know what’s best for you.

You will be fined, if you remove Windows from that laptop.

We can also fine you some more if you cannot prove the following:
1. Invoice from the seller that sold you the software.
2. Stating exactly the software details that was sold.
3. With the exact company name on the invoice.

If not, then oh well! We get more of your money!

We will block all computer hardware with UEFI anyways, so why bother attempting to switch to Linux.

We sue Android / Google in court and extort billions from them. So stay away from them losers.

See where this is going, it’s sad really. No one wants Windows 8, so M$ locks up the market with UEFI, making it hard for people to use Linux. They sue and extort their way, but this is changing.

My Mission

My observations and opinions about IT are based on 40 years of use in science and technology and lately, in education. I like IT that is fast, cost-effective and reliable. I do not care whether my solution is the same as yours. I like to think for myself.

My first use of GNU/Linux in 2001 was so remarkably better than what I had been using, I feel it is important work to share GNU/Linux with the world. I have been blessed by working in schools where students and school systems have benefited by good, modular software easily installed in most systems.

I have shown GNU/Linux to thousands of students and hundreds of teachers over the years and will continue in some way doing that until I die in spite of the opposition.